Rental property in India within “Smart Cities” may undergo a transformation as a part of a government scheme to provide affordable housing to the urban poor. The government is rolling out a welfare scheme by which it would spend nearly 2,700 crore rupees every year, on households in urban regions, to be used for the purpose of providing money as rent to Below Poverty Line (BPL) families.

Smart Beginnings Using Vouchers

The scheme would be implemented in 100 “Smart Cities” across India by providing rent vouchers to the poor. Real estate in India will be transformed by this action as rental vouchers would make it possible for the urban poor to pay for rented accommodations. Landlords would be able to redeem the rent vouchers at any citizen service bureau. If the rent commanded by the landlords is greater than the value of the rent voucher, the tenant would be required to make up the balance by paying cash to the landlord.

The policy to provide housing to the urban poor has been in the pipeline for nearly three years, yet the first phase is being implemented during the calendar years of 2017-2018 in “Smart Cities”.

As the government’s wish to provide housing for all within five years is implemented, providing rent vouchers to families that are unable to live in “Pakka” houses is one aspect of the drive towards housing for all. The cost of this drive, which hopes to remove those living in unplanned housing and shanties in urban regions by providing them with the means by which they may reside in planned houses, will be 2,713 crore rupees every year. In the long term the likely goal is not only to beautify cities and make infrastructure easier to manage but rather to integrate BPL (Below Poverty Line) families into the nations formal economic ecosystem. property in India, if the measure is successful, will be renovated as the value of many properties across the country will rise upon removal of unplanned slums and shanties that are found in areas housing Higher Income Group families.

The vouchers would be distributed to Below Poverty Line (BPL) families and to the migrant population by urban local bodies.

The Value of Vouchers

The urban local bodies that distribute the vouchers will calculate the value on a voucher on the basis of the class or size of the house being rented and by considering the prevailing rental charges in the city. Real estate in India may receive altered valuations upon completion of official surveys by the urban local bodies.